Exemption from IGST / GST in certain specified cases

The fitment committee has exempted IGST (Integrated Goods and Service Tax) on imports of life saving medicines supplied free of cost by overseas supplier for patients. This exemption has also been applied on imports of goods (except vehicles) in case the IGST is paid on the lease amount.

Also the exemption has been outstretched to the dairy cooperatives where milk is distributed through companies registered under the Companies Act, where this exemption was limited to production.

Other changes have also been made on some of the services which are as follows

Also the restaurants will now fall in the 5% tax bracket irrespective of being air conditioned or not. Food parcels will also attract 5% GST without ITC.

Hotels having room tariff of less than Rs 7500 per unit per day will also fall in GST of 5% without ITC.

Hotels having room tariff of Rs 7500 and above per unit per day will also fall in GST of 5% without ITC.

As before it has been fixed, the outdoor catering will continue to be at 18% tax bracket will full ITC

Rationalisation of certain exemption entries

Services that Fair Price Shops provide to the Central Government, State Government, or Union Territories by way of sale of basic necessities such as food grains, kerosene, sugar, edible oil etc has been taken into consideration and was rationalized in order to clear out the confusion regarding list of items and the category of recipients to whom the exemption is available.

Intellectual property is a supply of goods and services

Permanent transfer of Intellectual Property other than Information Technology software attracts GST at the rate of 12%.

Permanent transfer of Intellectual Property in respect of Information Technology software attracts GST at the rate of 18%.